Spiralling costs and a lack of value for
money have resulted from the Departmentof Health’s failure to get to grips with IT contractors on the patient
records project, according to the PublicAccounts Committee (PAC).

A report, published today by the PAC, raises
concerns over costs, project objectives and the performance of the senior responsible
owner (SRO) – NHS chief executive David Nicholson – on the department’s £7
billion project to create a fully integrated patient records system.

The project, which is part of the wider
National Programme for IT (NPfIT) in the NHS, has so far cost £2.7 billion. To
complete it would cost a further £4.3 billion. But with the original aim of a
fully integrated system scrapped and poor performance from current suppliers, the PAC has questioned whether the remaining
money should be spent on different systems for the NHS.

Committee chairman and Labour MP Margaret
Hodge said: “It [the Department of Health] should now urgently review whether
it is worth continuing with the remaining elements of the care records system.
The £4.3 billion, which the department expects to spend, might be better used
to buy systems that are proven to work, that are good value for money and
deliver demonstrable benefits to the NHS.”

The PAC report cited a number of failings in
the overall management of the programme, including: not implementing an
up-to-date alternative to the original system; a lack of consultation with
health professionals during the early stages; and a failure by NHS chief
executive David Nicholson to meet his responsibilities as the project SRO.

The conduct of suppliers CSC and BT was also heavily criticised in the report. It said both companies
had failed to deliver the number of systems required in their contracts. The
Department of Health has managed to renegotiate the contract with BT, but the
PAC said it was still too expensive. In the case of CSC, which failed to
deliver the majority of systems they were contracted to, the department has
admitted cancelling the contract may cost more than waiting for CSC to complete
it.

In April 2007, five years into the NPfIT, the
PAC raised serious concerns about the project and concluded it was running two years behind schedule. In
January this year, PAC member Richard Bacon called on the Department of Health to halt payments to suppliers until independent reports had been conducted. In
the same month CSC was paid an advance of £200 million, which it failed to
report to PAC when expressly told to do so in June.